AI Summary
5 min readIn April 2024, Dr. Ankur Crawford, portfolio manager of the Alger Concentrated Equity ETF (ticker CNEQ), told the Animal Spirits hosts she thought she was wrong about memory chip maker Micron. The stock was at $454, and despite her conviction, the market wasn't confirming her thesis. She was humble enough to assume the market was right. Two months later, Micron was at $1,080. The stock had risen 135% in the time it took for the market to catch up to her analysis. That experience frames her entire argument: this AI cycle is not a bubble, and investors relying on historical precedent are missing what makes it fundamentally different.
Why the "Bubble" Framing Is Misleading
Crawford argues that calling the current AI buildout a bubble is a failure of imagination rooted in linear thinking. The core difference, she says, is that we have never seen innovation occur at this speed. "When software begins to write software, innovation becomes exponential," she explains. Unlike past technological shifts—like the iPhone, which required physical hardware to be manufactured and distributed to every user—AI is a digital innovation with no barrier to adoption. The penetration curve is instant, and the productivity gains are immediately clear. This creates a demand for compute that is structurally unmatched by supply.
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What you'll learn
- 1 (00:44) **Introduction: Dr. Ankur Crawford Returns** - Michael and Ben introduce Ankur Crawford, portfolio manager at Alger, who has deep boots-on-the-ground experience from her time at Intel.
- 2 (02:49) **The Memory Trade: When the Market Told Her She Was Wrong** - Ankur recounts how she thought she was wrong about Micron because the stock wasn't moving, but the market eventually confirmed her thesis.
- 3 (04:41) **Why This Is Not a Bubble: Duration and Pricing Power** - Ankur argues the AI trade has duration, citing rising NeoCloud GPU pricing and Anthropic's surging revenue.
- 4 (05:45) **The Flaw in Using History as a Guide** - Ankur explains why past tech bubbles are a poor comparison for the current AI cycle.
- 5 (09:17) **The Semiconductor Supply Chain: From Forgotten to Essential** - Ankur describes how the semiconductor supply chain has consolidated and shifted from a cyclical, low-respect sector to one with immense pricing power.
- 6 (12:26) **Sticking to the Thesis: Hardware Over Software** - Ankur explains her big-picture thesis from early 2023: value should accrete to the hardware and semiconductor supply chain, not software.
- 7 (14:21) **The Supply Chain is the Cap on Growth** - Ankur explains why the supply chain itself prevents a bubble: it is rate-limited.
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Show Notes
On this episode of Animal Spirits: Talk Your Book, Michael Batnick and Ben Carlson are joined by Dr. Ankur Crawford from Alger to discuss: what everyone is getting wrong about the AI trade, why this technology is different, letting the market tell you if you're wrong or right, and how to manage a concentrated portfolio of stocks.
Find complete show notes on our blogs...
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